Of Work 2018 Member Companies

PROGRAM 2017 OF WORK 2018 MEMBER COMPANIES

MEMBER COMPANIES

A MESSAGE FROM THE CHAIR

I am honored to serve as the chair of the U.S. Chamber of to reach new levels of regulatory efficiency, reassurance Commerce's Brazil-U.S. Business Council. There is boundless for international investors, intellectual property rights, labor opportunity to expand relations between the U.S. and Brazil regulations, and environmental protections. during this critical juncture for both countries. The business community plays a central role in shaping the relationship In 2016, Brazil embarked on a fundamental transformation bilaterally, regionally, and globally. aimed at restoring economic growth and setting the country on a sustainable path to development. The U.S. investor Citi has operated in Brazil for over 100 years, serving as community supports the Brazilian government and its people a trusted financial institution for our clients and enabling in pursuit of this important domestic structural reform agenda progress in the market. At the heart of this activity has been and remains confident about Brazil and its future. facilitating trade and investment between the U.S. and Brazil. The Brazil-U.S. Business Council has remained steadfastly U.S. companies have long considered the Brazilian market committed to strengthening the bilateral relationship during an essential part of their global expansion and footprint. It is a political transitions and challenging times and has proven itself key reason why the U.S.-Brazil commercial relationship is so to be a catalyst for innovative ideas and opportunities. The vigorous. In 2015, U.S. goods and services trade with Brazil success of our efforts is reflected in the increased economic totaled nearly US$95.4 billion. U.S. foreign direct investment relations achieved over the past decades. (FDI) in Brazil was US$65.2 billion, and Brazil’s FDI in the U.S. grew to US$23.7 billion in 2015. It is a privilege to serve as the chair of the Brazil-U.S. Business Council, and I look forward to collaborating with our member For this reason, the time has come for both governments to companies and partners in the coming years. make concrete progress in removing barriers to trade and investment and initiate efforts to establish bilateral agreements on tax and trade. These should be based on open, high- Jane Fraser standard, and market-based approaches to commerce. In Chief Executive Officer, addition to removing barriers, the two countries should seek Latin America, Citigroup

The business “community plays a central role in shaping Brazil- U.S. relations.

Cassia Carvalho 2 PROGRAM OF” WORK 2017–2018 Ɩ A MESSAGE FROM THE EXECUTIVE DIRECTOR

This is a new chapter in the U.S.-Brazil relationship. With If pursued, both nations will reap socioeconomic benefits changes in governments in both countries, we have the including sustained growth, employment generation, and opportunity to reshape the bilateral agenda and pursue ways prosperity, reaching an unrealized potential. to strengthen our friendship and economic ties. It is a unique time, one of emerging trends in global thinking. Now, more The U.S. Chamber of Commerce and the National than ever, both nations need to define a bold, robust strategic Confederation of Industry (CNI) have a long-standing agenda and collaborate on global and bilateral issues such as relationship that fosters joint initiatives and actions under the trade, energy, defense, natural resources, infrastructure, and Brazil-U.S. Business Council. The partnership, together with agriculture. business communities, has led to a common understanding on what is essential to reduce trade and investment barriers The 2017–2018 Program of Work aims to give U.S. and between the two countries. We are confident this proposed Brazilian policymakers and private sector leaders a clear framework for economic cooperation will lead to concrete path forward. Our hope is that the administrations in the U.S. results. and Brazil will use this policy agenda, outlined with priorities and recommendations put forth by the private sector, as a The Council is an essential platform for strategic government- foundation for their bilateral agendas and the government-to- to-business dialogues and a partner in creating a vision and business dialogues. We urge both governments to consider mission for the path ahead. new possibilities, strategic thinking, and innovative options. Cassia M. Carvalho We present a bold vision with pragmatic next steps, pillared on Executive Director, 40 years of solid work by the Brazil-U.S. Business Council. Brazil-U.S. Business Council

Both nations “need to deﬁne a bold, robust strategic agenda.

ƖPROGRAM OF WORK 2017–2018 ” 3 TABLE OF CONTENTS

ABOUT US AND WHAT WE DO 6 LEADERSHIP MEETINGS 9 LEADERSHIP 7 IN BRASILIA 2016 HIGHLIGHTS 8 ADVOCACY MISSION 10 TO BRASILIA

1. THE VISION FOR A STRATEGIC BRAZIL-U.S. ECONOMIC PARTNERSHIP 12

1.1. The Case for a Stronger Partnership: 13 Realizing the Potential 1.2. Five-Year Policy Accomplishments Timeline 14 1.3. Current State of Bilateral Trade and 16 Investment Relationship

BRAZIL: RECOVERY, 18 REFORM, OPPORTUNITY

2. BUILDING BLOCKS FOR THE BILATERAL RELATIONSHIP 19 2.1. Enhanced Economic Partnership: 20 A Roadmap 2.2. Ease of Doing Business 22 2.3. Elevated Regulatory Cooperation 23

TABLE OF 3. MECHANISMS FOR COORDINATION, 24 CONTENTS COLLABORATION, AND ENGAGEMENT 3.1. Dialogues 25 U.S.-Brazil Commercial 25 ABOUT US AND WHAT WE DO 6 LEADERSHIP MEETINGS Dialogue 9 Economic and Financial LEADERSHIP 7 IN BRASILIA 25 Dialogue (EFD) 4. POLICY AND 2016 HIGHLIGHTS 8 ADVOCACY MISSION The Commission on Economic 30 10 SECTOR AGENDAS TO BRASILIA and Trade Relations under the 25 U.S.-Brazil Agreement on Trade 4.1. Trade 31 and Economic Cooperation (ATEC) 4.2. Innovation 33 4.3. Tax & Investment 35 1. THE VISION FOR A Defense Cooperation Dialogue 25 4.3.1. Infrastructure Working STRATEGIC BRAZIL-U.S. (DCD) 39 Strategic Energy Dialogue (SED) 26 Group ECONOMIC PARTNERSHIP 12 Consultative Committee on 4.4. Defense & Security 40 26 Agriculture (CCA) 4.5. Healthcare 43 1.1. The Case for a Stronger Partnership: 13 4.6. Consumer Goods & Retail 45 Realizing the Potential Infrastructure Development 26 Working Group 1.2. Five-Year Policy Accomplishments Timeline 14 4.7. Energy 46 3.2. Congressional Forums 27 1.3. Current State of Bilateral Trade and 4.7.1. Oil & Gas Working Group 47 16 Brazil Congress: Brazil-U.S. Investment Relationship 27 4.8. Tourism & Hospitality 48 Parliamentary Group U.S. Congress: Brazil Caucus 27 BRAZIL: RECOVERY, 18

REFORM, OPPORTUNITY Defense & Security

Infrastructure

2. BUILDING BLOCKS FOR THE Tourism & Tax & Hospitality 19 Investment BILATERAL RELATIONSHIP Oil & Gas Innovation

Energy 2.1. Enhanced Economic Partnership: 49 Trade 20 MEET THE TEAM A Roadmap Consumer Ease of Doing Business 22 Goods & Retail 2.2. PARTNERS 50 2.3. Elevated Regulatory Cooperation 23 Healthcare

ABOUT US AND WHAT WE DO

Overview The Brazil-U.S. Business Council is the premier business The Brazil Section is managed by the National Confederation advocacy organization for U.S. companies conducting of Industry (CNI), composed of the 27 Brazilian state-level business in Brazil. The Council represents a variety of federations of industry. industries, including consumer goods, defense, energy, healthcare, infrastructure, logistics, security, technology, travel and tourism. The U.S. Section of the Council represents the Mission major U.S. companies invested in Brazil and operates under Protect and advance trade and investment between the the administrative aegis of the U.S. Chamber of Commerce, U.S. and Brazil through free trade, free markets, and free maintaining independent policy formulation and membership. enterprise.

What we do

Represent Analyze Serve the interests of major U.S. Assess the implications of existing companies that have trade and and new regulatory frameworks investment relations with Brazil. and policy agendas.

Promote Advocate Enhance the government-to-business Urge the implementation of political and dialogue and advance the bilateral economic measures that beneﬁt U.S. and agenda. Brazilian companies engaged in trade relations.

MEMBERSHIP BENEFITS

Level Corporate Board

Event access Corporate level benefits, plus: • Members-only events in the U.S. and Brazil. • Discounted participation in partner events and activities. Strategic and policy-shaping influence • Power to influence the Council’s strategic Business intelligence direction and policy. • Members-only executive information services. • Brazil Investment Monitor. Customized advocacy Benefits • Policy Monitor. • Stronger voice in policy concerns and • Access to Council policy and program staff challenges. for information and guidance. Leadership roles Advocacy missions • Seat on the board of directors. • State- and federal-level advocacy missions missions and • Opportunity to lead policy task forces and congressional briefings to advance policy issues and working groups. priorities.

6 PROGRAM OF WORK 2017–2018 Ɩ LEADERSHIP

Chairman of Citigroup Vice Chairman DuPont Jane Fraser Timothy P. Glenn the Board Chief Executive Officer, Latin America President, DuPont Crop Protection Chair McLarty Associates Albright Stonebridge Group Thomas F. “Mack” McLarty III Ambassador Anthony Harrington Emeritus Chairman and Co-Founder Chair of the Managing Board and Head of the Brazil and Latin America Practice Cargill Greg Page Executive Chairman of the Board U.S. Chamber U.S. Chamber of Commerce U.S. Chamber of Commerce Myron Brilliant Stan Harrell of Commerce Executive Vice President and Head of International Affairs Senior Vice President, CFO and CIO U.S. Chamber of Commerce Brazil-U.S. Business Council Jodi Hanson Bond Cassia Carvalho Senior Vice President, Americas Executive Director

Board of Apple IBM Susan Schmidt Christopher A. Padilla Directors Senior Manager, Government Affairs Latin America Vice President, Governmental Programs AES International Paper Scarlett Alvarez Mark S. Sutton Vice President, Chief Stakeholder Relations Chairman and Chief Executive Officer and Sustainability Officer Johnson & Johnson Baker McKenzie LLP Antonio Ferreira Eduardo C. Leite International Vice President, Janssen Latin America Chair Emeritus of the Executive Committee and Senior Partner Lockheed Martin Dave Trulio Boeing Regional Vice President and Chief of Operations Jefferson Hofgard Morgan Stanley Vice President, International Operations and Policy Thomas Nides Caterpillar Vice Chairman Odair Renosto Patri President, Brazil Eduardo Carlos Ricardo Chevron Partner and CEO Clay Neff PepsiCo President of Chevron Africa, Laxman Narasimhan Latin America Exploration and Production Chief Executive Officer, Latin America Foods Eli Lilly and Company The Coca-Cola Company Alfonso Zulueta Michael Goltzman President, Lilly International Vice President, International Government Relations and Public Affairs FedEx Express Marilyn Blanco-Reyes Walmart Vice President, Legal and Regulatory Affairs Dan Bryant Latin America and Caribbean Division Senior Vice President for Global Public Policy and Government Affairs General Electric Ambassador David Nelson WestRock Senior Manager, Global Government Affairs Jairo Andreis Lorenzatto and Policy–Americas President, WestRock Brazil

Ɩ PROGRAM OF WORK 2017–2018 7 2016 HIGHLIGHTS

Junior Rosa

Tereza Sobreira

Robert Schroder, senior vice president, International Strategy and Operations, U.S. Chamber of Commerce (right), and Marcos Pereira, minister, Ministry of Development, Industry and Foreign Trade, greeted each other during the Annual Plenary, moments before the Council, CNI, and Amcham Brasil delivered the joint report to the Brazilian Raul Jungmann, minister, Ministry of Defense, and Liliana government, December 7, 2016. Ayalde, then-U.S. ambassador to Brazil, spoke during the inaugural Defense Industry Dialogue in Brasilia. The event gathered more than 150 U.S. and Brazilian defense industry officials and government experts to discuss policies and business issues before the U.S. and Brazilian defense industries, September 30, 2016.

Dee Wong for STUDIOPRI.COM Bruno Schwartz

The Council hosted a roundtable with Dyogo Oliveira, minister, Ministry of Planning, Development, and Budget (left center), and Jorge Arbache, secretary of International Affairs, Ministry of Planning, Development, and Budget The Council hosted a meeting with Blairo Maggi, minister, Ministry (right), to engage the U.S. private sector and showcase of Agriculture, Livestock, and Food Supply, and a delegation the “Crescer” infrastucture program, October 6, 2016. of public officials and private sector representatives at the U.S. Chamber. Cassia Carvalho, executive director, Brazil-U.S. Business Council, and Council members had exclusive access to speak with Minister Maggi about his outlook on Brazil’s agriculture, food security, sustainability, biotechnology, market access, and investment prospects, July 27, 2016.

8 PROGRAM OF WORK 2017–2018 Ɩ LEADERSHIP MEETINGS IN BRASILIA

The Council led a delegation of more than 20 leadership DuPont Brasil (Council vice chair), met with ministers and member companies to Brasilia to meet with the government executive secretaries from the Ministries of Health; Defense; from June 30 to July 1, 2016. The delegation, led by Kellie Planning, Budget, and Management; Trade and Services; Meiman Hock, managing partner, McLarty Associates Transportation; and Foreign Relations. (then-Council chair), and Priscilla Vansetti, president,

Council delegates met with Ambassador Marcos Abbott Galvão, secretary general, Foreign Affairs, at Itamaraty Palace (Ministry of Foreign Affairs headquarters) to discuss bilateral agenda priorities, June 30, 2016.

Junior Rosa

Cassia Carvalho, executive director, Brazil-U.S. Business Council, spoke during a meeting with Brazil’s government to present key components of the bilateral relationship and the Council’s policy agenda, July 1, 2016.

Representatives of the Council’s leadership engaged with Ricardo Barros, minister, Ministry of Health (far right), to reinforce the commitment of the U.S. business community to Brazil, June 30, 2016.

Representatives of the Council’s leadership attended several meetings in Brasilia, June 30–July 1, 2016. Junior Rosa

Ɩ PROGRAM OF WORK 2017–2018 9 ADVOCACY MISSION TO BRASILIA

Our advocacy mission gathered senior executives in Brasilia for meetings with Brazilian government officials from December 5 to 8, 2016. The mission, which focused on the healthcare, innovation, and infrastructure sectors, included

Junior Rosa strategic engagement with key decision makers from the Brazilian Congress and the Temer administration.

Cassia Carvalho, executive director, Brazil-U.S. Business Council, discussed strategic priorities for the bilateral relationship with Deputy Luiz Carlos Hauly, president, Brazil- U.S. Parliamentary Group, during one of the advocacy meetings, December 7, 2016.

Junior Rosa

Robert Schroder, senior vice president, International Strategy and Operations, U.S. Chamber of

Commerce, spoke during the Annual Plenary held Junior Rosa with the Council’s partner organization CNI. The Plenary showcased government and private sector leadership while celebrating the Council’s 40th anniversary, December 7, 2016.

Junior Rosa

The inaugural U.S.-Brazil government-to-business infrastructure meeting joined private sector representatives from both countries to discuss upcoming project opportunities and exchange best practices in infrastructure development, December 8, 2016.

The Council team, led by Robert Schroder, senior vice president, International Strategy and Operations, U.S. Chamber of Commerce (far left), hosted a business delegation of U.S. companies in Brasilia, December 7, 2016.

10 PROGRAM OF WORK 2017–2018 Ɩ MEDICAL BREAKTHROUGHS MAY COME OUT OF THE LAB. BUT THEY BEGIN IN THE HEART.

For more than a century, a very special passion has driven the people of Merck. Our goal is to develop medicines, vaccines, and animal health innovations that will improve the lives of millions. Still, we know there is much more to be done. And we’re doing it, with a long- standing commitment to research and development. We’re just as committed to expanding access to healthcare and working with others who share our passion to create a healthier world. Together, we’ll meet that challenge. With all our heart.

For more information about getting Merck medicines and vaccines for free, visit merckhelps.com or call 800-727-5400. Copyright © 2016 Merck Sharp & Dohme Corp., a subsidiary of Merck & Co., Inc. All Rights Reserved. CORP-1060080-0100 01/16 Dee Wong for STUDIOPRI.COM

The leadership of the Council’s U.S. and Brazil sections met in Washington, D.C., to discuss strategy and priorities, building on momentum to advance an ambitious Brazil-U.S. business agenda, October 6, 2016. 1 THE VISION FOR A STRATEGIC BRAZIL-U.S. ECONOMIC PARTNERSHIP THE CASE FOR A STRONGER PARTNERSHIP: 1.1. REALIZING THE POTENTIAL

Myron Brilliant, executive vice president and head of International Affairs, U.S. Chamber of Commerce, discussed Brazil’s economic recovery and U.S. political transition and priorities during the 2016 Brazil Economic Conference, October 7, 2016.

Pedro Carvalho for STUDIOPRI.COM

Brazil has the potential to become one of the most significant • A bilateral investment treaty (BIT) that promotes economic trading partners of the U.S. Economic, geopolitical, and cooperation and stimulates the flow of capital. cultural factors support this vision. The two countries have • Free movement of people in each other’s territories. always been allies; are natural world leaders strategically located in the Western Hemisphere; have stable democracies In the short term, the Council continues to advance a robust and strong institutions; and offer enormous consumer policy agenda focused on promoting near-term attainable markets and areas for cooperation on global issues. accomplishments contributing to the bilateral agenda, such as Economic opportunities exist in defense, energy, infrastructure the following: development, and agriculture, among others. In sectors such as health, science, and innovation, cooperation can be • Regulatory coherence, convergence, and standards expanded to elevate government-to-business collaboration. harmonization led by the U.S. Department of Commerce and Brazil’s Ministry of Industries, Foreign Trade, and Both Brazil and the U.S. have seen increases in two-way trade Services. and investment, and the private sectors in both countries have • Trade facilitation, including the mutual recognition voiced their desire to further enhance the bilateral relationship. agreement between the U.S. Customs Trade Partnership This requires structural and fiscal reforms, as well as strong Against Terrorism and Brazil’s authorized economic political will by both governments. operator initiatives. • The expansion of the Patent Prosecution Highway The Council believes that ambitious goals should be set for agreement signed in 2015. two-way trade and investment. While there has been progress • Infrastructure development cooperation under the 2016 in Brazil, much more can be done to improve free trade and Memorandum of Cooperation. investors’ confidence, and deeper economic integration. Brazil • Negotiation of a Technology Safeguards Agreement (TSA) is an attractive partner for the U.S. The bilateral relationship that would open up a window of opportunities for needs to advance and promote institutionalized frameworks co-partnership and production in the space arena. for long-term growth and sustainability. • Support the approval and promulgation of the Brazil-U.S. Open Skies Agreement, signed in Brazil in 2011, but not The Council calls on both nations to establish the following: yet in force in Brazil. This agreement will boost tourism and travel between the two countries. • A comprehensive trade agreement with significantly lower tariffs and reduction of non-tariff barriers, The Council is the preeminent business group for U.S.-Brazil supported by regulatory cooperation. economic, political, and policy issues and the private sector • A bilateral tax treaty that eliminates double taxation voice for these joint initiatives. Now is the time to advance a bold and offers mutual gains. policy agenda with strategic goals toward long-term success.

Ɩ1. THE VISION FOR A STRATEGIC BRAZIL-U.S. ECONOMIC PARTNERSHIP 13 FIVE-YEAR POLICY 1.2. ACCOMPLISHMENTS TIMELINE

Brazil Council Work and Support for Key Policy Accomplishments in the Brazil-U.S. relationship As illustrated in the graphic, there have been signiﬁcant accomplishments since 2012 in areas such as trade, tax, defense, health, infrastructure, food and agriculture, and patent regulation.

Brazil ratifies WTO Trade Brazil ratifies Multilateral Convention Brazilian government enacts a law Brazil implements ATA Carnet Facilitation Agreement. on Mutual Administrative Assistance to end the state company monopoly system in the Istanbul in Tax Matters. on pre-salt fields in the oil sector. Convention, signed in 2011. Brazilian and U.S. governments Brazil and U.S. sign an agreement to Brazilian and U.S. governments sign Letter of Intent to solidify sign Memorandum of Cooperation allow certain beef and beef products to bilateral support for continued cooperation between their respective on Infrastructure Development. be traded in both markets. defense industries via the U.S.-Brazil Defense Industry Dialogue.

U.S. Chamber and Brazil Council host Brazil and U.S. sign a Patent Brazilian Congress approves U.S.-Brazil Brazilian Congress approves President Dilma Rousseff for the Prosecution Highway Defense Cooperation Agreement. U.S.-Brazil General Security of second time in Washington, D.C. (PPH) Agreement. Military Information Agreement. Brazil and U.S. sign Social Security Brazil and U.S. sign a Memorandum U.S. Department of Commerce and its Brazilian Totalization Agreement to eliminate of Understanding on Health and counterpart sign a Memorandum of Understanding to dual contributions. Medical Sciences to boost establish an outline for continued best practices cooperation on health issues. exchanges to institutionalize good regulatory practices.

Brazil and U.S. sign an Brazil and U.S. resolve decade-old intergovernmental agreement to World Trade Organization (WTO) implement the Foreign Account Tax dispute over cotton subsidies. Compliance Act (FATCA).

Member countries sign WTO U.S. Chamber and Brazil Council host Brazilian Congress approves Agreement on Trade Facilitation. President Dilma Rousseff for the ﬁrst Brazil-U.S. Tax Information Exchange time in Washington, D.C. Agreement, signed in 2007.

Brazil and U.S. sign spirits recognition Brazil Council is established as U.S. revokes an anti-dumping agreement, resulting in the recognition of BRAZTAC chair. order on orange juice from Brazil, cachaça, Tennessee whiskey, and bourbon. in compliance with a WTO ruling.

14 PROGRAM OF WORK 2017−2018 Ɩ Brazil Council Work and Support for Key Policy Accomplishments in the Brazil-U.S. relationship As illustrated in the graphic, there have been signiﬁcant accomplishments since 2012 in areas such as trade, tax, defense, health, infrastructure, food and agriculture, and patent regulation.

Ɩ 1. THE VISION FOR A STRATEGIC BRAZIL-U.S. ECONOMIC PARTNERSHIP 15 CURRENT STATE OF BILATERAL 1.3. TRADE AND INVESTMENT RELATIONSHIP

Robert Schroder, senior vice president, International Strategy and Operations, U.S. Chamber of Commerce (right), and Ricardo Barros, minister, Ministry of Health, discussed the Council’s healthcare policy agenda during the Advocacy Mission, December 6, 2016.

Junior Rosa

The U.S. and Brazil, the two largest democracies and economies in the Western Hemisphere, have a robust bilateral relationship founded on shared values and commitments. Political and economic ties between the two countries have traditionally been strong. The partnership is focused on expanding economic growth and prosperity. The following ﬁgures demostrate the depth of the economic relationship.

Source for all information is USTR unless stated otherwise.

Exports $ 59.5 billion Imports $ 35.9 billion Goods and Services Trade Total $ 95.4 billion U.S. Trade Surplus $ 23.6 billion Good Exports $ 32 billion Good Imports $ 27 billion Trade in Goods Total $ 59 billion U.S. goods trade surplus $ 4.3 billion Services exports $ 27.8 billion Services imports $ 8.5 billion Trade in Services Total $ 36.3 billion U.S. services trade surplus $ 19.3 billion Jobs supported by goods exports 165,000 Jobs supported by U.S. exports to Jobs supported by services exports 182,000 Brazil (2015)* Total 308,000 U.S. FDI in Brazil (stock) $ 65.2 billion FDI (2015)** Brazil's FDI in the U.S. (stock) $ 23.7 billion Sales of services by majority U.S.-owned $ 39.6 billion * Source: Office of Trade affiliates in Brazil and Economic Analysis, U.S. Sales of services (2013) Sales of services in the U.S. by majority $ 2.0 billion Department of Commerce Brazil-owned firms ** Source: Select USA, U.S. Department of Commerce

16 PROGRAM OF WORK 2017−2018 Ɩ One story — Different Languages and Time Zones

Eduardo Leite Chairman Emeritus and Senior Partner

During my last year as global chairman of Baker McKenzie, I was fortunate to become involved with a project that left a lasting impression on me—our work supporting street youth of the world across eight cities in four continents.

The ﬁrst campaigns involved signiﬁcant consultations with the kids and was organized in January 2016 in Rio de Janeiro by the Consortium for Street Children, the leading international network of organizations working for street children’s rights, and the U.K. charity Street Child United, with support from Baker McKenzie.

It was brought home to me when Brazilian colleagues told me about the scale of the daily and cruel reality faced by many kids endangered by the lack of basic rights—homes, education, and health. Let me illustrate this with the story I heard from Jose (not his real name). His story touched me deeply, and he was very vocal during the meeting.

Jose shared his unique perspectives of life on the street, such as not beig allowed to go to school because he did not have a birth certiﬁcate, or how he felt unsafe during major sports events held in his city in 2016, which he and others like him were very much uninvited.

Jose’s speech directly fed into the new United Nations international guidance on how governments can fulﬁll their human rights obligations to this group of children. Street- connected children—who may live or work on the street or simply spend much of their time in public spaces—experience severe and ongoing violations of rights and threats. They are constantly exposed to violence, adult abuse, drugs, and crime. They experience extreme stigma and discrimination and are often unable to access food, clean water, shelter, healthcare, and other basic services. Jose does not know what it is to have dreams and aspirations for a better life.

Perceived as a hard-to-reach group, street children are too often ignored by our society and made invisible in policy agendas. It is my hope that we, the responsible business leaders, can continue to do more to promote the voices of this often resilient and resourceful group of young people to be heard at the highest levels.

Taking advantage of Baker McKenzie’s global footprint, we were able to support seven similar consultation events held throughout the ﬁrst half of last year, all in different markets across the world. For this pro bono initiative, we counted on the support of our local team but also our U.S. attorneys working closely with Brazilian colleagues. It gave us a sense of how many Joses are out there—with different languages and time zones but all facing the same challenges and threats. I hope we can continue to make a difference in improving Jose’s life and future.

Ɩ1. THE VISION FOR A STRATEGIC BRAZIL-U.S. ECONOMIC PARTNERSHIP BRAZIL: RECOVERY, REFORM, OPPORTUNITY

The Council is working steadily to support and promote the business community within the context of the bilateral relationship between Brazil and the U.S. One of our contributions is the production of a white paper with suggestions for Brazil to restore investor confidence and resume economic growth with a broad economic and regulatory reform agenda. Visit www.brazilcouncil.org/media/publications to access the white paper.

The ongoing political transitions in Brazil and the U.S. have the reforms is to ensure greater transparency and a harmonized potential to provide both economies with a fresh start. Brazil is rulemaking process to create a more legally secure, predictable in the midst of internal domestic reforms and is looking to the regulatory framework for domestic and foreign firms doing globe for development partners. The U.S. is reevaluating its business in Brazil. The government also needs to commit to trade relations, providing a ripe opportunity to define a path for combatting corruption and inefficiency by adhering to high sustainable economic growth between the two countries. standards of transparency, fairness, and integrity.

The Council strongly believes that Brazil must seize the Modernized Infrastructure moment and pursue a forward-looking reform agenda based A cornerstone of Temer’s reform agenda is a revamped on sound economic policies, business-friendly regulations, privatizations concessions strategy for infrastructure. modernized infrastructure, and robust international Temer’s administration has been advancing the agenda to partnerships. Both collectively and individually, these reforms attract both foreign and local investor interest. Much of the would unleash a new round of growth and renewed openness privatizations concessions program is directed at modernizing to foreign investment, anchored in sound economic policies. Brazil’s infrastructure, currently a challenge to the country’s Leveling the playing field and expanding Brazil’s trade architecture competitiveness and an obstacle to profitable business and commercial relationships, both globally and with the U.S., opportunities. should be higher priorities than ever before. Deepened International Partnerships Sound Economic Policies Brazil should increase its partnerships and expand its trade President Temer should remain focused on passing key fiscal architecture to take advantage of new global opportunities. structural reforms, including Social Security reform, and In addition, Brazil should pursue full membership in the measures to limit expenditure growth. If his administration Organisation for Economic Co-operation and Development succeeds in securing parliamentary approval for these reforms, (OECD), the World Trade Organization’s (WTO’s) Trade in it would address Brazil’s medium-term fiscal problems, Services Agreement (TISA), the WTO Information Technology restoring sustainability and halting the rise of the debt-to- Agreement (ITA), and the WTO Government Procurement GDP ratio. This would help restore confidence and enable the Agreement (GPA). Brazilian Central Bank to sustain the contraction of interest rates. Interest rate reduction would further alleviate the Now is the time for Brazil to look outward to support government’s debt burdens, as well as those of the corporate sustainable growth, and one of the main engines of that sector and households. This would also lower investment growth will be foreign direct investment (FDI). Under the right costs, providing a much-needed boost to economic activity. conditions, U.S. companies and investors, which have long regarded the Brazilian market as an essential part of their global A Business-Friendly Environment strategies, are prepared to seize opportunities in the country. Brazil should remain steadfast in pursuing a broad agenda of The Council is convinced that this is the opportune moment to microeconomic reforms aimed at addressing the difficulties of make changes and secure a strong economic future. doing business in Brazil. The objective of these microeconomic

18 PROGRAM OF WORK 2017–2018 Ɩ Junior Rosa

(Left to right) Carlos Eduardo Abijaodi, director, Industrial Development, CNI; Cassia Carvalho, executive director, Brazil-U.S. Business Council; Robert Schroder, senior vice president, International Strategy and Operations, U.S. Chamber of Commerce; Paulo Cesar de Souza e Silva, president and CEO, Embraer S.A., and chair of the Brazil-U.S. Business Council, Brazil Section; Rubens Antonio Barbosa, former Brazilian ambassador to the U.S.; and Nelson Salgado, senior vice president, Strategy and Institutional Relations, Embraer S.A., celebrated the Council’s 40th anniversary during the Annual Plenary in Brasilia, December 7, 2016. 2 BUILDING BLOCKS FOR THE BILATERAL RELATIONSHIP

In 2017, the Council launched three initiatives aiming at building blocks for a more productive and sustainable bilateral relationship:

• Enhanced economic partnership. • Ease of doing business. • Elevated regulatory cooperation. ENHANCED ECONOMIC PARTNERSHIP: 2.1. A ROADMAP

The Council urges both governments to open a dialogue on a potential trade agreement. While the U.S.-Brazil trade IMPACT OF A U.S.-BR AZIL TRADE AGREEMENT relationship is signiﬁcant, it could be expanded further to beneﬁt Effects on U.S. gross domestic product (GDP), national income, exports, imports, wages, and employment by 2030 the U.S. and Brazilian economies through an agreement that reduces tariffs and non-tariff barriers to trade. Impact of a Trade Agreement on the U.S.

The largest economy $95.4 5 by Broad Sector Categories

To support this policy priority, the Council and its partners, the 1 Brazil in Latin America Total U.S.-Brazil Trade National Confederation of Industry (CNI) and Amcham Brasil, billion 0 (Percent and billions VALUE EXPORTS EXPORTS 2 of 2011 dollars, ADDED TO BRAZIL TO WORLD EMPLOYMENT launched a trade agreement campaign based on two studies The 9th largest n thousands of jobs) in the world i and a joint report. Exports to Brazil 0.09% $20.778.35% $62.1 1.25% $40.30.05% 96.0 Leading goods 0.12 4.5 60.6 1.70 40.5 1 Goods 121.36 0.07 13.8 The Council in 2016 conducted a comprehensive study in 11th largest goods U.S. foreign direct investment (FDI) in Brazil was Agriculture, -0.10 -0.5 43.42 0.4 0.11 0.3 -0.12 -0.1 collaboration with Trade Partnership Worldwide, LLC to assess destination forestry, fishing the economic impact of a trade agreement on U.S. industry. $65.2 billion in 2015. Brazil's FDI in the for U.S. Manufactured goods 0.17 5.1 128.04 60.2 2.00 40.3 0.14 14.5 The infographic features key takeaways from the Council study Energy products -0.04 -0.2 -0.36 -* -0.24 -0.1 -0.04 -0.7 on the effect of a U.S.-Brazil trade agreement on the U.S. United States was $23.7 billion in 2015. U.S. exports of goods and services to Brazil Services 0.09 16.2 5.26 1.6 -0.31 -0.2 0.05 82.3 economy. U.S. Department of Commerce and USTR (latest data available) supported an estimated 308,000 jobs in 2015. Private business services 0.08 7.8 1.07 0.3 -0.36 -0.2 0.01 8.7 U.S. Dept. of Commerce and USTR (latest data available) Other services 0.10 8.4 15.94 1.3 -0.24 0.0 0.12 73.6 The study shows that a U.S.-Brazil trade agreement would have Creating jobs in 2014 trade data show a net positive impact on U.S. GDP ($24 billion growth), national manufacturing sector * Less than $50 million Trade Partnership Worldwide, LLC. income ($30 billion growth), exports to Brazil ($62 billion), Brazilian exports Imports from Brazil imports from Brazil ($7.1 billion), wages (0.11% increase), and 75% to U.S. are Employment growth in every state 75,000+ since Texas New York Florida employment (100,000 jobs). manufactured and Service imports Leading goods California jobs 2010 semimanufactured (make up 50%) 11,165 8,150 6,560 5,550 A similar study2 commissioned by Amcham Brasil concludes products Output gains in every state — In additional GSP that a U.S.-Brazil trade agreement would have a net positive California Texas New York Illinois impact on Brazil GDP ($38 billion), exports ($25 billion), and $2.5 B $2.2 B $1.7 B $1.2 B imports ($28 billion). Key Takeaways Increased exports to Brazil from every state During the 34th Annual Plenary in Brasilia in December Texas Florida Illinois California U.S. employment U.S. gross domestic product $11.9 B $8.3 B $8.3 B $3.2 B 2016, the U.S. Chamber of Commerce, the Council, CNI, expands by nearly expands by about and AmCham Brasil released a joint report on the effects of U.S. Trade of Goods and Services to Brazil, 2004—2014 Job growth in nearly all — 432 of 435 — congressional districts a bilateral trade agreement. The report, A Roadmap to an 100,000 US$24 Top districts with job gains Enhanced Economic Partnership, recommends measures to billion Total Total Trade Brazil’s Brazil’s New York New York California Georgia reduce trade barriers, especially non-tariff barriers, while moving jobs Exports Imports Balance Share of Total Share of Total 12th District 10th 17th 5th to Brazil from Brazil with Brazil U.S. exports U.S. imports District District District closer to regulatory convergence. additional jobs 915 705 jobs 670 jobs 545 jobs Household incomes (i.e., consumer US$30 2004 $18.8 B $23.0 B $-4.2 1.6% 1.3% Alongside CNI and Amcham Brasil, the Council plans to benefits) grow by about billion 2014 $59.5 B $35.9 B $23.3 2.1% 1.3% Additional output in nearly all — 433 of 435 — congressional districts disseminate the joint trade report in both Brazil and the U.S. Annual U.S. Department of Commerce, Bureau of Economic Analysis, “U.S. Top districts 15.1% 6.6% Trade in Goods and Services by Selected Countries and Areas, in 2017 and 2018. The campaign will also reach out to the U.S. exports to Brazil Growth 1999—Present,” http://www.bea.gov/international/index.htm#trade New York New York Texas Texas while exports to the world 12th District 2nd U.S. and Brazilian governments, including Congress and the increase 10th 18th grow $301 M District District District executive branch. The Council will engage the Congressional in additional GDP $201 M $143 M $140 M Brazil Caucus of the U.S. Congress and the Brazil-U.S. 78% 1+% Parliamentary Group of the Brazilian Congress in unveiling the Expanded exports to Brazil from every congressional district joint trade report. Estimated Economy—Wide Impacts Top districts Florida Illinois Texas Illinois 18th 14th 17th The studies and the joint report demonstrate why Brazil should U.S. imports from Brazil, GDP 0.11% 8th District Real national income 0.13% GDP $23.5 B District District District be next on the U.S.’ trade dialogue priority list. With renewed benefiting U.S. households & U.S. exports & imports $1.6 B $1.2 B $1.1 B $1.1 B Exports to Brazil 78.35% Real national income $29.3 B in additional exports energy on Brazil and U.S. relations, it is time to define a bold manufacturers increase as a whole to the world Imports from Brazil 21.15% Exports to Brazil ($) $62.0 B bilateral agenda with a roadmap toward the future. increase Exports to the world 1.25% Imports from Brazil ($) $7.1 B Transportation Travel and 21% Medical Equipment Machinery Tourism related Imports from the world 1.17% Exports to the world ($) $40.2 B Metal Real wages 0.11% Imports from the world ($) $43.5 B Petroleum Transportation Percent Change Products $7 Employment (number) Employment 0.05% 96,029 Trade Partnership Worldwide, LLC. billion Agricultural Brazilian business Payments for intellectual 1. Brazil-U.S. Business Council (2016) and Trade Partnership Worldwide, LLC, Products services property rights Impact of a U.S. Trade Agreement on the U.S. Economy.

2. AmCham Brasil and FGV EESP (2016), Alternativas do Brasil, 2016. BUSBC, Impact of A U.S.-Brazil Trade Agreement.

20 PROGRAM OF WORK 2017–2018 Ɩ IMPACT OF A U.S.-BR AZIL TRADE AGREEMENT Effects on U.S. gross domestic product (GDP), national income, exports, imports, wages, and employment by 2030

Impact of a Trade Agreement on the U.S.

The largest economy $95.4 5 by Broad Sector Categories Brazil in Latin America Total U.S.-Brazil Trade 1 billion 0 (Percent and billions VALUE EXPORTS EXPORTS The 9th largest 2 of 2011 dollars, ADDED TO BRAZIL TO WORLD EMPLOYMENT in the world in thousands of jobs) Exports to Brazil 0.09% $20.778.35% $62.1 1.25% $40.30.05% 96.0 Leading goods Goods 0.12 4.5 121.36 60.6 1.70 40.5 0.07 13.8 11th largest goods U.S. foreign direct investment (FDI) in Brazil was Agriculture, -0.10 -0.5 43.42 0.4 0.11 0.3 -0.12 -0.1 destination forestry, ﬁshing $65.2 billion in 2015. Brazil's FDI in the for U.S. Manufactured goods 0.17 5.1 128.04 60.2 2.00 40.3 0.14 14.5 Energy products -0.04 -0.2 -0.36 -* -0.24 -0.1 -0.04 -0.7 United States was $23.7 billion in 2015. U.S. exports of goods and services to Brazil Services 0.09 16.2 5.26 1.6 -0.31 -0.2 0.05 82.3 U.S. Department of Commerce and USTR (latest data available) supported an estimated 308,000 jobs in 2015. Private business services 0.08 7.8 1.07 0.3 -0.36 -0.2 0.01 8.7 U.S. Dept. of Commerce and USTR (latest data available) Other services 0.10 8.4 15.94 1.3 -0.24 0.0 0.12 73.6 Creating jobs in 2014 trade data show manufacturing sector * Less than $50 million Trade Partnership Worldwide, LLC. Brazilian exports Imports from Brazil 75% to U.S. are Employment growth in every state 75,000+ since Texas New York Florida manufactured and Service imports Leading goods California jobs 2010 semimanufactured (make up 50%) 11,165 8,150 6,560 5,550 products Output gains in every state — In additional GSP California Texas New York Illinois $2.5 B $2.2 B $1.7 B $1.2 B Key Takeaways Increased exports to Brazil from every state Texas Florida Illinois California U.S. employment U.S. gross domestic product $11.9 B $8.3 B $8.3 B $3.2 B expands by nearly expands by about U.S. Trade of Goods and Services to Brazil, 2004—20142004 Job growth in nearly all — 432 of 435 — congressional districts 100,000 US$24 Top districts with job gains billion Total Total Trade Brazil’s Brazil’s New York New York California Georgia jobs Exports Imports Balance Share of Total Share of Total 12th District 10th 17th 5th to Brazil from Brazil with Brazil U.S. exports U.S. imports District District District additional jobs 915 705 jobs 670 jobs 545 jobs Household incomes (i.e., consumer US$30 2004 $18.8 B $23.0 B $-4.2 1.6% 1.3% beneﬁts) grow by about billion 2014 $59.5 B $35.9 B $23.3 2.1% 1.3% Additional output in nearly all — 433 of 435 — congressional districts Annual U.S. Department of Commerce, Bureau of Economic Analysis, “U.S. Top districts 15.1% 6.6% Trade in Goods and Services by Selected Countries and Areas, U.S. exports to Brazil Growth 19991999—Present,”—Present,” http://www.bea.gov/international/index.htm#trade New York New York Texas Texas while exports to the world 12th District 2nd increase 10th 18th grow $301 M District District District in additional GDP $201 M $143 M $140 M

78% 1+% Expanded exports to Brazil from every congressional district Estimated Economy—Wide Impacts Top districts Florida Illinois Texas Illinois 18th 14th 17th U.S. imports from Brazil, GDP 0.11% 8th District Real national income 0.13% GDP $23.5 B District District District beneﬁting U.S. households & U.S. exports & imports $1.6 B $1.2 B $1.1 B $1.1 B Exports to Brazil 78.35% Real national income $29.3 B in additional exports manufacturers increase as a whole to the world Imports from Brazil 21.15% Exports to Brazil ($) $62.0 B increase Exports to the world 1.25% Imports from Brazil ($) $7.1 B Transportation Travel and 21% Medical Equipment Machinery Tourism related Imports from the world 1.17% Exports to the world ($) $40.2 B Metal Real wages 0.11% Imports from the world ($) $43.5 B Petroleum Transportation Percent Change Products $7 Employment (number) Employment 0.05% 96,029 Trade Partnership Worldwide, LLC. billion Agricultural Brazilian business Payments for intellectual Products services property rights

Ɩ 2. BUILDING BLOCKS FOR THE BILATERAL RELATIONSHIP 21 EASE OF 2.2. DOING BUSINESS

The Council urges the Brazilian government to adopt and implement the following policy reforms to improve the business climate and drive investment and economic growth in Brazil:

Labor Reform to Generate Jobs Favorable and Predictable Legal Environment to • Secure the effectiveness of the new labor framework, Attract Investments including outsourcing regulation and labor reform. Recommend advances on property rights and legal Urge outsourcing, allowing entrepreneurs to outsource • • frameworks for regulated markets to ensure legal certain activities based on business models, while certainty on foreign investments. protecting outsourced employees’ rights under the Recognize the importance of patent protection through law. (Accomplished) • both governments’ renewal and expansion of the scope Support labor reform and outsourcing regulation in the • of the Patent Prosecution Highway agreement, signed Brazilian Congress. (Accomplished) in 2015, to allow U.S. patent applications before Brazil’s National Institute of Industrial Property (INPI) in all Tax Reform to Advance Path to Growth technical fields for an unlimited time period. • Support personal liability of shareholders and directors as • Reduce the complexity and cumulative nature of the an extraordinary measure to secure creditors’ rights with federal, state, and municipal tax systems to lower clear legal criteria, implying covenants of good faith and compliance costs for enterprises, improving legal ensuring full defense and fair hearings. certainty. • Recommend regulating foreign acquisition of lands with • Promote efforts to harmonize Brazil’s VAT tax (ICMS). reasonable limits on the purchase of land that does not • Validate ICMS fiscal incentives. (Accomplished) hinder productive operations. • Endorse the following pieces of legislation and reforms: • Promote a revision of the agencies’ control and rulemaking process as an important measure toward o Tax reform. transparency and improvement of the business environment. o Tax simplification. o Unification of ICMS. o Validation of fiscal incentives. (Accomplished) Local Content Requirement Reform to o Tax substitution regulation. Facilitate Investment o Compensation of tax debits with tax and Social Security credits. • Urge more flexible local content requirements to accom- o Minimum implementation period for measures that modate rapid innovation and local supply gaps prevalent increase costs to corporations. in infrastructure, high-tech, IT, and oil & gas industries where the requirements do not align with the fast-paced reality of advanced manufacturing. Trade Facilitation to Improve Trade Flows Infrastructure Improvements to Reduce Logistics Costs • Support the full implementation of the WTO Trade Facilitation Agreement and programs like the Single • Urge revision and unification of rules regarding Window and the Authorized Economic Operator (AEO). infrastructure public bidding according to international • Work toward achieving a U.S.-Brazil mutual recognition best practices and dissemination of the new rules to gain agreement of AEO and the U.S. Customs Trade investors’ interest. Proactively address these issues: Partnership against Terrorism (C-TPAT). Promote the economic benefits associated with expediting bank credit o Project bidding process prioritization. card payment settlements. o Transparent bidding process promotion. • Recommend streamlining Brazil’s bureaucratic o Environmental licensing process streamlined. procedures, while ensuring a stable and predictable o Local content requirement flexibility. legal and regulatory framework for Brazilian and foreign o Innovative project financing models. investors by enacting a law to harmonize the rulemaking process. • Support consultations, adjustments, and approvals of • Support Brazil’s accession to the Revised Kyoto these bills: Convention urging standardization and harmonization of customs procedures. o Consolidation of Public Procurement Legislation. o Adjustment on Reference Price for Biddings. o Optimization of Environmental Licensing Process. o Credit Payment Settlement.

22 PROGRAM OF WORK 2017–2018 Ɩ ELEVATED 2.3. REGULATORY COOPERATION

What Is Regulatory Cooperation? What Is Regulatory Coherence?

Regulatory cooperation is any interaction between regulators Regulatory coherence refers to the internal coordination from different countries, resulting in some form of cooperation and review process under which the whole-of- to gain efﬁciency while achieving a desired regulatory government works to ensure that rules and regulations outcome. Some examples: are crafted in an open, transparent, and participatory manner and outcomes are risk based and grounded in Harmonization—When one country changes its regulation to follow that of another, the result is harmonized regulatory the best available data. requirements, with compliance often remaining at the purview of each jurisdiction. Through regulatory coherence, government agencies are better coordinated and work together to achieve Regulatory Convergence—When different countries decide to identiﬁed policy objectives, thereby avoiding overlapping modify their existing or proposed regulatory frameworks to be and inconsistent rules. in closer alignment. Mutual Recognition/Substitute Compliance—With a focus on compliance, regulators are required to identify common regulatory objectives, followed by assurance that respective regulatory frameworks achieve similar outcomes, resulting in regulatory compliance within one framework.

The Council recommends that Brazil implement a whole- The Council engages year-round with the U.S. Department of of-government regulatory coherence policy, securing Commerce, CNI, and U.S. companies to identify regulatory all-encompassing legislation that provides regulatory issues that can be incorporated into the agenda of the harmonization and transparency in federal government Commercial Dialogue. Regulatory cooperation, including rulemaking. coherence, convergence, harmonization, and mutual recognition, is a priority of the Council and U.S. companies. The Council encourages the use of good regulatory practices in the process of planning, issuing, implementing, and • The Council leverages the expertise of the Center reviewing regulatory measures as a top priority for U.S. for Global Regulatory Cooperation (GRC) at the U.S. companies doing business in Brazil. Chamber to provide resourceful publications to both the U.S. and Brazilian governments on regulatory The Council closely monitors legislative proposals in the cooperation. Together with GRC, the Council is releasing Brazilian Congress regarding management, organization, a guide on regulatory best practices and two publications decision making, and social control of regulatory agencies, as on data privacy—one on data privacy authorities and well as requirements for regulatory impact assessments prior another on consent. to rulemaking. • On mutual recognition of bilateral frameworks, the Council urges Brazil and the United States to sign an The Council continues to urge Brazil’s government to provide agreement where both countries would recognize their increased legal certainty to safeguard and promote private respective customs-authorized economic operators’ investment and pass legislation that advances harmonization programs. See http://www.brazilcouncil.org/wp- and transparency in rulemaking, including provisions on the content/uploads/2017/03/Trade-Policy-Agenda-ENG-3. following: compressed.pdf. • The Council urges the Brazilian government to implement • Regulatory impact analysis. a system of advanced customs rulings, which is one of • Notice of rulemaking. the commitments under the Trade Facilitation Agreement. • Meaningful public consultations. Advanced customs rulings are a tool of great value to • Reasonable period of time for rule implementation. importers and exporters as they interpret and guide the application of customs laws and regulations to a speciﬁc, The Council is the platform for companies to provide input to prospective transaction. government authorities on bilateral regulatory cooperation. The U.S.-Brazil Commercial Dialogue is the main forum used by the Council to work on regulatory cooperation with U.S. companies, Brazilian companies, and both governments.

Ɩ 2. BUILDING BLOCKS FOR THE BILATERAL RELATIONSHIP 23 Tereza Sobreira

John Lopes, regional executive, Lockheed Martin International and chair of the Council’s Defense & Security Task Force (center), represents the U.S. private sector perspective together with Ken Hyatt, acting under secretary, International Trade, U.S. Department of Commerce (right), and Flavio Basilio, secretary, Defense Products, Ministry of Defense (left), during the inaugural Defense Industry Dialogue in Brasilia, September 30, 2016. 3 MECHANISMS FOR COORDINATION, COLLABORATION, AND ENGAGEMENT

A successful U.S-Brazil relationship relies on exchanges at many levels that take place in the context of bilateral government-to- government and government-to-business dialogues, working groups, and fora. The Council is a strong advocate of these engagement opportunities as they promote mutually beneﬁcial agendas and strenghen the relationship. DIALOGUES 3.1.

U.S.-Brazil Commercial Dialogue The Commission on Economic and Trade Relations under the U.S.-Brazil Agreement Established in 2006, the U.S.-Brazil Commercial Dialogue is a ministerial-level forum led by the U.S. Department of Commerce on Trade and Economic Cooperation (ATEC) and Brazil’s Ministry of Industry, Foreign Trade, and Services. The Dialogue maintains five working groups: trade partnership, Under this Commission, authorized by ATEC in 2011, both services, intellectual property, standardization, and industry & countries can explore greater cooperation on a variety of investment. Over the past two years, the Commercial Dialogue issues including investment, intellectual property rights has served to promote closer bilateral relations between the and innovation, cross-border trade in services, and small U.S. and Brazilian governments with a focus on trade facilitation businesses. The U.S. Trade Representative and Brazil’s policy issues. Ministry of External Relations are the government agencies in charge of leading this joint Commission. The Commercial Dialogue is a key forum for advancing trade facilitation priorities and has yielded concrete results As provided for in the ATEC, the Council recommends for both countries in the areas of regulatory engagement, that private sector input be incorporated into Commission trade statistics, intellectual property, standards & metrology, meetings and is at the Commission’s disposal to organize services, and supply chain (see, e.g., http://trade.gov/press/ briefings and debriefings before and after meetings. press-releases/2015/us-brazil-commercial-dialogue-joint- Considering the Commission’s scope of work, the Council statement-03192015.asp). recognizes it as the primary forum to initiate formal negotiations for a bilateral trade agreement. Since 2011, the two sections of the Council have been following and contributing to the Dialogue, providing briefings and debriefings prior to government meetings. This important The Council recommends the launch of a initiative offers Council members the opportunity to engage with scoping exercise on the economic benefits the secretaries of Foreign Trade for both Brazil and the U.S. regarding their priorities and recommendations. of a trade agreement. The Council supports the Brazil-U.S. Commercial Dialogue to continue its work Defense Cooperation Dialogue (DCD) and schedule regular meetings with private The U.S.-Brazil DCD is co-chaired by the U.S. Department sector paricipation. of Defense and Brazil’s Ministry of Defense. Its first meeting took place April 24, 2012, in Brasilia where the respective secretaries met. The DCD agenda focuses on seven priority areas–communications; cooperation to support African Economic and Financial Dialogue (EFD) nations; cybersecurity; humanitarian assistance and disaster response; logistics; science, innovation, and technology transfer; and support to civil authorities in organizing The U.S. Department of Treasury leads the EFD, which first international events. met in 2011 to promote shared global economic policy positions. The EFD is the main vehicle for discussions with Brazil’s Finance Ministry and Central Bank. The Council supports the confirmation

Under this dialogue, the Council supports the continuation of the DCD’s annual meeting schedule in of discussions on a bilateral tax treaty (BTT) that would 2017 and 2018, bringing new perspectives streamline tax preparation, strip away legal uncertainties, and increase competitiveness between U.S. and Brazilian and opportunities for alignment with the companies in bilateral trade. A BTT would also end most forms of double taxation for companies and individuals doing recently formed government-to-business business in the two countries. Defense Industry Dialogue launched in Under this dialogue, the Council supports September 2016, further aligning bilateral the relaunch of discussions on a bilateral priorities and highlighting partnership tax treaty (BTT). opportunities.

Ɩ 3. MECHANISMS FOR COORDINATION, COLLABORATION, AND ENGAGEMENT 25 DIALOGUES 3.1.

Strategic Energy Dialogue (SED) Infrastructure Development Working Group (IDWG)

The U.S.-Brazil SED is a presidential-level partnership that The IDWG was established March 30, 2016, via the provides an overarching framework for deepening cooperation signed U.S.-Brazil Memorandum of Cooperation (MOC) on between the two nations’ energy sectors. The SED was Infrastructure Development to complement and strengthen announced by former Presidents Obama and Rousseff engagement under the U.S.-Brazil Transportation Partnership, during President Obama’s visit to Brazil in March 2011 as a Aviation Partnership and Strategic Energy Dialogue. The way for the two countries to work together to develop safe, Group is co-chaired by the U.S. Department of Commerce; sustainable, affordable, and secure energy resources. U.S. Trade and Development Agency; Brazil’s Ministry of Planning, Budget, and Management; and Brazil’s Ministry of At the November 2015 SED meeting, the two governments External Relations, with support from various other agencies. updated their priority areas to include oil and natural gas, civil nuclear energy, renewables, energy efficiency, biofuels, With the objective of increasing infrastructure investments and smart grids. The SED announced that new topics for between the two countries and improving the overall business discussion will include carbon capture and storage, the climate, the Group showcases private sector expertise energy-water nexus, and biofuels. in sharing best practices on topics such as financing mechanisms, project preparation, procurement, The Council recommends scheduling and successful public-private partnerships. SED meetings in 2017 and 2018, urges The Council supports furthering the private sector participation, and reinforces government-to-business collaboration the need to focus on energy efficiency as a platform to advance private sector initiatives. expertise in critical investment areas, including financing and project preparation. Consultative Committee on Agriculture (CCA) Other dialogues that are also part of the government agenda The U.S.-Brazil CCA was established by a 2003 Memorandum include the Global Partnership Dialogue (GPD), the Economic of Understanding. It was signed at the U.S.-Brazil Presidential Partnership Dialogue (EPD), and the U.S.-Brazil Internet Summit between former Presidents George W. Bush and and Information and Communications Technologies (ICT) Luiz Inácio Lula da Silva. The CCA provides an opportunity Working Group. The timing is appropriate for reengaging these to coordinate policy in a number of areas including market dialogues with new administrations in both the U.S. and Brazil. access, food safety, research, technical assistance, and standards setting. It provides a forum for the two countries to address bilateral trade issues as they arise, develop recommendations, share ideas, and better coordinate policies to benefit farmers, businesses, and consumers.

The Council endorses the CCA and suggests an agenda with private sector participation and a focus on agricultural technology, research and development, agricultural competitiveness, financing, export assistance, and a regulatory framework.

26 PROGRAM OF WORK 2017–2018 Ɩ CONGRESSIONAL 3.2. FORUMS

Brazil Congress: Brazil-U.S. Parliamentary Group

The Council, recognizing Parliament’s importance in formulating the public policies that comprise its bilateral agenda, understands that deputies’ and senators’ work must be supported by a legitimate platform, which is the Brazil-U.S. Parliamentary Group. Through this Group, the Council has endorsed structural reforms in the areas of pension, labor, tax, and ﬁscal initiatives to spur growth, urge recovery, and foster Brazil’s insertion in global value chains.

The Council’s activities with the Brazilian Congress are primarily with the Parliamentary Group with a focus on keeping it up to date on the relevance of the legislative agenda for the bilateral relationship. The Council also contributes its private sector expertise to better shape legislative proposals on key issues, such as trade, civil law, research and development, healthcare, and the environment, that indirectly affect U.S. companies doing business in Brazil.

In addition, the Council supports inviting Brazilian members Junior Rosa of Congress to visit the U.S. Capitol and share best practices and perspectives with the Brazil Caucus. These interactions enable proposed and implemented Brazilian public policies to Deputy Luiz Carlos Hauly, president, Brazil-U.S. Parliamentary Group (left), and Robert Schroder, senior vice president, International Strategy and Operations, have broad and ever-increasing global awareness, especially U.S. Chamber of Commerce, discussed tax and fiscal reforms under way in the regarding trade and investment between Brazil and the U.S. Brazilian Congress during the Advocacy Mission to Brasilia, December 6, 2016.

U.S. Congress: Brazil Caucus

The Brazil-U.S. Business Council continues its outreach and engagement with the U.S. Congress. The Council has had a long-standing relationship with the Brazil Caucus on Capitol Hill and will continue its briefings for Caucus members and staff. The Council also works closely with committees of jurisdiction in Congress, including the House Foreign Affairs and Senate Foreign Relations committees (with particular focus on Western Hemisphere subcommittee members); the House Ways and Means Committee; the Senate Finance Committee; and House and Senate leadership offices. Moreover, the Council coordinates with the U.S. Embassy and Amcham Brasil to facilitate congressional delegation visits to Brazil so that it can provide briefings, materials, and messaging for those congressional offices.

Rep. Patrick Meehan (R-PA) spoke to Council members, U.S. and Brazilian

Brazil Industries Coalition Photography governments, and multilateral organizations during the Brazil on the Hill Series, June 1, 2015.

Ɩ 3. MECHANISMS FOR COORDINATION, COLLABORATION, AND ENGAGEMENT 27 “Brazil is not for beginners” — Tom Jobim But it is a land of great opportunity

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Effectively managing public affairs has become critical for With our team of highly qualified in-house trained young most businesses in Brazil since the end of the 21-year military professionals, we have designed over the years our own regime in 1985. PATRI’s creation coincides with the drafting of process of work and kept ourselves updated with the constant the 1988 Constitution, the progression of democracy, and the changes of this business in an ever-growing interconnected rule of law in Brazil. At that time, the professional services of world. advocacy, government relations, lobbying, and public affairs were scarce. We offer our clients quick, accurate, and valuable information in an environment where the multiplication of opinions, Culturally, these services were associated with conducting decision makers, and public policy proposals grows shady deals through closed doors and via third parties with vertiginously. Our unstained 30-year ethical record reassures good relations with public officials. However, over the past our clients that they can rely on such information. three decades, the institutionalization of Brazilian democracy created a favorable environment for the exercise of public Because we understand the policymaking flow of the Brazilian policy and public affairs activities. public policies formulation, we can help our clients be prepared, anticipate risks, and seize opportunities. We believe Fast track influence peddling has gradually given room to the that the companies doing business in Brazil must be active legitimate defense of corporate interests, and the exercise players in the policymaking process. To make sure they are, of managing public affairs has been gaining legitimacy and we offer them the necessary support so that our clients are market recognition. heard, understood, and can reach their objectives. Defense & Security

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4 POLICY AND SECTOR AGENDAS

The 2017–2018 Program of Work emphasizes the Council’s The Council will strategically engage with key decision makers priorities to strengthening the economic and commercial in the U.S. and Brazilian governments to provide policy partnership between Brazil and the U.S. recommendations and advocate for changes needed to enhance the economic and commercial relationship between For this edition, the Council redefined its strategic priorities the two countries. to focus on the three initiatives mentioned earlier: enhanced economic partnership, ease of doing business, and elevated Each policy agenda is staffed and chaired by member regulatory cooperation. It also defined policy agendas and companies that shape advocacy efforts in both Brazil and the priorities with the input from the business community for the U.S. Council members are eligible to lead and join multiple task work ahead. forces and working groups where they can discuss horizontal and sector-specific policy priorities, and, most importantly, help shape the agenda moving forward. TRADE 4.1.

Chair Vice Chair

The Trade Task Force proposes a number of actions to prioritize and drive economic growth in Brazil:

Brazil’s full insertion into world trade with membership in Requests the Brazilian Federal Revenue to amend the following: Normative Instruction No. 1639/2016, which provides for • The Organisation for Economic Co-operation and the temporary admission of goods, to allow ATA carnets Development (OECD). from countries that ratified either the Istanbul Convention • WTO Trade Services. of 1990 or the ATA Carnet Convention of 1961. The • WTO Information Technology. current norm requires that a valid ATA carnet be issued • WTO Government Procurement Agreements. by the contracting country of the Istanbul Convention, a convention for which the U.S. is not a party. A U.S. government “scoping exercise” with private sector contribution for a potential U.S.-Brazil trade Endorse the U.S.-Brazil Consultative Committee on agreement and the reopening of formal bilateral tax Agriculture (CCA) with private sector participation, treaty negotiations. aiming at boosting bilateral cooperation along the Trade facilitation to improve trade flows: entire agribusiness activity chain: • Support the full implementation of the WTO Trade • Agricultural technology. Facilitation Agreement and programs like the • Research and development. Single Window and the Authorized Economic • Agricultural competitiveness. Operator (AEO). • Financing. • Work toward achieving a U.S.-Brazil mutual • Export assistance. recognition agreement of AEO and the U.S. • Regulatory framework. Customs Trade Partnership against Terrorism Encourage bilateral discussions on these topics: (C-TPAT). Food security. Promote the economic benefits associated with • • Farmer access to new technology. expediting bank credit card payment settlements. • Biotechnology. Recommend streamlining Brazil’s bureaucratic • • U.S.-Brazil cooperation with third countries for procedures, while assuring a stable and • market access. predictable legal and regulatory framework for Brazilian and foreign investors, with the Support easing bureaucratic bottlenecks in the seed enactment of a law to harmonize the rulemaking export process through the review and simplification of process. MAPA’s (Ministry of Agriculture, Livestock, and Supply) Support Brazil’s accession to the Revised Kyoto • normative instructions: Convention to encourage standardization and For Normative Instruction No. 50/2006, eliminate harmonization of customs procedures. • the compulsory export authorization in exchange Support a whole-of-government regulatory coherence for requiring the private sector to abide by approach in Brazil to ensure that rules and regulations standard agreements and treaties governing are crafted in a transparent and collaborative process international trade, as well as incorporating clear with the private sector and that the rulemaking process rules for exports in kilograms. is consistent across the entire government. Encourage • For Normative Instruction No. 57/2013, allow seed approval of legislation on rulemaking with provisions producers’ laboratories to become accredited. regarding the following: • Regulatory impact analysis. Support the adoption of legislation in Brazil that • Adequate notice on rulemaking. promotes a science- and risk-based approach to • Meaningful public consultations. chemical regulation to ensure appropriate health and • Reasonable period of time for rule implementation. environmental protections, prevent the imposition of regulatory barriers to trade, reduce costs, and create other efficiencies for governments and industry. Ɩ 4. POLICY AND SECTOR AGENDAS 31 P E O L W P E O R E IN P G D N IN N A O ET VA AN TIO PL Through the engineering of biology, N F IER Intrexon is helping to address some of the OR A ALTH world’s most pressing challenges including invasive HE disease-carrying mosquitoes and sustainability of food production.

Oxitec, an Intrexon subsidiary, has utilized advanced genetics to create a self-limiting Friendly™ Aedes mosquito, which is actively being deployed in Brazil, to control populations of the dangerous Aedes aegypti, the primary vector for dengue, Zika, chikungunya and yellow fever.

Oxitec’s self-limiting technology along with Intrexon’s biological engineering solutions are also being applied to agricultural pest management to improve marketable crop yield and quality through targeted reduction of insect populations without off-target environmental effects.

Learn more about Intrexon at www.dna.com and Oxitec at www.oxitec.com.br / www.oxitec.com. INNOVATION 4.2.

Chair Vice Chair

The Innovation Task Force recognizes that as participation in international investment and technology transfer becomes more competitive around the world, it is critical that both industry and government collaborate to ensure that Brazil becomes a global technology leader. To that end, the Council puts forth the following agenda:

Encourage the adoption of regulations furthering data Urge the implementation of the Inter-American privacy in Brazil, while promoting trade and growth Telecommunication Commission’s (CITEL’s) Mutual and striking a balance between public and private Recognition Agreement (MRA) regarding the U.S.; interests. provide mutual recognition of conformity assessment bodies and acceptance of testing results and certification Support data protection interoperability initiatives in procedures for telecommunications equipment. Brazil, as well as privacy regimes and frameworks that Urge the withdrawal of local content requirements are technology neutral, ensure accountable cross- to accommodate rapid innovation prevalent in border flows of information, protect consumers, reflect high-tech and IT industries in Brazil, with special today’s global business models, and allow benefits of attention to instances where basic production process e-commerce and cloud computing. requirements do not align with the fast-paced reality of advanced manufacturing, software, and other Promote internet regulations in Brazil that accommodate advanced technology industries. transborder information flows and their decentralized nature, enabling consumers to benefit from secure data Support legislation in Brazil that would consider use and privacy. e-books and e-readers to be similar to printed books; approval of such legislation would widen access to Support increased measures to ensure adequate and affordable e-books and foster social inclusion for effective enforcement of all forms of IP rights in Brazil. millions of Brazilians. Advocate for adherence of Brazil to the Madrid Protocol for the International Registration of Marks to expedite Promote initiatives that reduce regulatory burdens, trademark applications and approvals. facilitate business, and increase accessibility by reducing internet and mobile broadband costs in Recognize the importance of patent protection through Brazil, especially considering the importance of both governments’ renewal and expansion of the the new application (app) industry in creating jobs, scope of the Patent Prosecution Highway agreement, supporting small business, and generating wealth. signed in 2015, to allow U.S. patent applications before Brazil’s National Institute of Industrial Property (INPI) in Support the adoption of regulations in Brazil that all technical fields for an unlimited time period. promote a flexible, innovation-based approach to cybersecurity and public-private discussions on cyber best practices and threat of information sharing.

Ɩ 4. POLICY AND SECTOR AGENDAS 33 WHAT PART DOES A GLOBAL BANK PLAY IN BRAZIL’S DEVELOPMENT?

Brazil is a country of continental proportions whose development is largely concentrated across its major urban centers.

This scenario started to change – at least in the Três Lagoas region, state of Mato Grosso do Sul – after the arrival of Fibria, a global leader in the pulp market.

Citi and Fibria teamed up and helped the city to grow sustainably, reaching the status of third largest city of Mato Grosso do Sul, after generating more than 10,000 direct and indirect jobs.

The pulp currently produced in Três Lagoas is exported to the entire world and the region keeps on growing bigger and better.

Check out how Citi is helping Brazil grow: citi.com.br/progresso

#progressmakers

45216_370347_Citibank_ProgressMakers_8,5x11_inches.indd 1 2/17/17 3:03 PM TAX & 4.3. INVESTMENT

Chair Vice Chair

The Tax & Investment Task Force aims to enhance bilateral investment between Brazil and the U.S. by facilitating cross-border investment and reducing the cost of doing business for foreign companies. To that end, the Council is working on the following agenda:

Support tax simpliﬁcation reforms in Brazil to reduce the Promote efforts to harmonize the value-added tax (VAT), complexity and cumulative nature of federal, state, and known in Brazil as the Tax on Operations Related to the municipal tax systems to reduce costs for enterprises Circulation of Goods and Services of Inter-Municipal and improve legal certainty. Interstate Transportation and Communication (Imposto Sobre Operações Relativas à Circulação de Mercadorias e Serviços de Transporte Interestadual de Intermunicipal Support reform of the current PIS/COFINS legislation e de Comunicações–ICMS). in Brazil, reiterating the importance of ensuring tax neutrality for tax payers. Support Brazil’s adoption of the Organisation for Economic Co-operation and Development (OECD) Endorse resuming formal negotiations between investment principles. Brazil and the U.S. on a bilateral tax treaty that would eliminate double taxation and/or taxes on royalties, Support congressional action to loosen interest, and dividends. restrictions on rural land ownership as a means to economic growth in Brazil.

Recommend terminating the uncertainty of the Recommend that the Brazil and U.S. governments so-called tax war among Brazilian states with new move forward with discussions on a Bilateral legislation that ensures predictability, protects past Investment Treaty (BIT), soliciting feedback from beneﬁts already granted for the industry, and provides the private sector. clarity on the concession of beneﬁts.

Ɩ 4. POLICY AND SECTOR AGENDAS 35 A unique law ﬁrm

Brazilian full service ﬁrm offering clients top-notch legal services. A strategic partner for your business in Brazil.

São Paulo | Rio de Janeiro | Brasília | New York | London www.mattosﬁlho.com.br Brazilian Tax System: Searching for Solutions

Glaucia M. Lauletta Frascino Partner Mattos Filho, Veiga Filho, Marrey Jr e Quiroga Advogados

We have been discussing the need for tax reform in Brazil for a long time. The advantages of eventual reform are obvious and already known by many people: rationalization of taxes, simplification of compliance with accessory obligations, attraction of nonspeculative foreign capital, reduction of informality, and elimination of conflict among states. However, there are challenges to making actual tax reform a reality.

The distribution of tax revenues among the Federal Union, states, and cities is one of the main instruments of independence among them. So it is difficult to imagine tax reform not preceded by political reform, which would certainly demand time and effort. In view of this, the question is: What can be done in the short term to maximize benefits, remediate conflicts, and overcome difficulties? Surely, the answer to this A unique law ﬁrm question requires dealing with certain obstacles and specific matters.

Let us start with the Contribution to the PIS (Social Integration Program) and the Contribution for Financing the Social Security (COFINS), both of which are federal taxes. These are taxes on revenue, representing almost 10% of companies’ Brazilian full service ﬁrm offering clients revenues (precisely 9.25%). These taxes are extremely onerous and must be simplified and gathered into a single top-notch legal services. A strategic value-added tax, becoming more coherent and facilitating Brazil’s business environment. partner for your business in Brazil. At the state level, the major issue still pending is a solution to the so-called tax war. The federal government has signaled a possible solution, which would validate past benefits granted and prohibit granting new unilateral benefits in the future. The creation of a compensatory fund is being discussed to compensate for the losses of some states by others. However, the matter has not advanced to a permanent solution.

Last, it is impossible to discuss taxation in Brazil without mentioning the excessive burden on payrolls, which obviously discourages the formal hiring of workers and does not contribute to the diminishing high unemployment rates.

Rationalization, simplification, and transparency are terms often used when debating the main tax issues in Brazil. If we cannot solve all the issues in the short term, let us at least face some of them. Reviving the economy, resuming growth, and generating opportunities for future generations depend on it.

São Paulo | Rio de Janeiro | Brasília | New York | London www.mattosﬁlho.com.br

Ɩ 4. POLICY AND SECTOR AGENDAS DuPont Agriculture Division recognizes and thanks the Brazil - U.S. Business Council for its efforts to grow a solid bilateral relationship between Brazil and the United States.

A Divisão Agrícola da DuPont reconhece e agradece os esforços do Conselho Empresarial Brasil - Estados Unidos de cultivar uma sólida relação bilateral entre os dois países.

dupontco | DuPontBrasil | dupontdobrasil | company/dupont

COPYRIGHT® 2016 DUPONT. ALL RIGHTS RESERVED. THE DUPONT OVAL LOGO, DUPONT™ AND ALL PRODUCTS DENOTED WITH ® OR ™ ARE REGISTERED TRADEMARKS OR TRADEMARKS OF E.I. DU PONT DE NEMOURS AND COMPANY OR ITS AFFILIATES. CRÉDITOS DA IMAGEM: TIAGO HAUAGGE. INFRASTRUCTURE 4.3.1. WORKING GROUP

The Infrastructure Working Group is aligned with the drive to modernize Brazil’s infrastructure as key toward the country’s global competitiveness. Intent on attracting more foreign direct investment (FDI), the Temer administration has proposed a reform agenda centered on privatization and revamped concession processes relating to much-needed large-scale infrastructure upgrades. The Council, which serves as a U.S. private sector partner, focuses on representing industry priorities:

Establish mechanisms to guarantee transparency and Urge the Brazilian and U.S. governments to embrace accountability in Brazil: private sector expertise via the Memorandum of • Ensure contributions from the private sector for Cooperation on Infrastructure Development, signed in the following: March 2016. o Innovative ﬁnancing models. o Risk assessment and mitigation. o Procurement best practices. o Regulatory uncertainty. Mobilize private capital and increase efﬁciency of public o Transparency in decision making. resources by leveraging measures adopted through o Project planning and prioritization. Brazil’s Investment Partnerships Program (PPI).

• Endorse the modernization of Public Procurement Law 8666 and the consolidation of its correlative rules. Ensure that potential changes in tax legislation do not increase the cost of transportation. • Approve measures that promote a ﬂexible approach to local content requirements in the oil & gas, IT, and defense industries to better accommodate rapid innovation, gaps in local supply chains, and the development of a robust talent pipeline.

Ɩ 4. POLICY AND SECTOR AGENDAS 39 DEFENSE & 4.4. SECURITY

Chair Vice Chair

The Defense & Security Task Force promotes a robust agenda aimed at enhancing commercial partnerships and opportunities for the private sector. To foster progress in the bilateral relationship, the task force has outlined a list of actionable, results- oriented policy recommendations for both countries:

Leverage the Defense Industry Dialogue as a platform Support advancing discussions on a Technology to advance private sector priorities and business Safeguards Agreement (TSA) as a preliminary step opportunities in these areas: toward a robust bilateral space cooperation agenda. • Commercial and industrial partnership. • Technology transfer, export control, and compliance. Promote easing U.S. export control measures • Mutual recognition of military production for military and dual-use products, services, and certification. technologies being exported to Brazil. • Regulatory and industrial policy. Applaud the Brazilian and U.S. governments for Support revision of Law 12.598/2012, specifically the committing to advancing the Aviation Partnership and definition of a strategic defense company, to allow U.S. efforts to align private sector expertise with investment companies to better participate in public bids for the opportunities. purchase and/or development of defense products and systems. Support the resumption of the Defense Cooperation Support the Brazilian National Congress’ approval of Dialogue, which serves as a platform for both PDC 424/2016, the Air Transport Agreement (ASA or governments to increase their engagement on defense Open Skies). and security issues at the highest political level.

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Black_Hawk_ADV_Brazil_US_Business_Council_031817.indd 1 3/16/17 11:32 AM Lilly Global Health Partnership delivering our promise to unite caring with discovery to make life better for people around the world. HEALTHCARE 4.5.

Chair Vice Chair

The Healthcare Task Force promotes policies and programs that drive smart investments in health, leading to economic growth, job creation, wellness, and increased productivity in Brazil while strengthening the commercial ties between Brazil and the U.S. Lilly Global Health To that end, the Council recommends the agenda below:

Further discussion of the economic impact caused by Support initiatives that foster innovation and technology certain diseases in Brazil regarding the following: aimed at enhancing the following: Partnership • Public healthcare costs. • Life expectancy. • Worker productivity decline. • Quality of life. • Preventable mortality and morbidity. • Diagnostic and treatment options. • Economic output. • Efficiency and cost effectiveness of the healthcare system. delivering our promise to unite caring Promote cooperation between the U.S. and Brazilian Support efforts by ANVISA to address the bottlenecks governments with contributions from the private through a combination of these measures: with discovery to make life better for sector, through these actions: • Implementation of increased risk assessment • ANVISA and Food and Drug Administration (FDA) evaluation for low-risk (class I and II) medical devices. dialogue. • Modification of the ANVISA personnel rules allowing people around the world. • Brazil-U.S. Commercial Dialogue. relocation and assignment of PAF (ports, airports, and • Memorandum of Understanding between the borders) staff and resources to critically delayed ports. U.S. and Brazil on Health and Medical Sciences. • Implementation of an integrated and dynamic digital electronic system, eliminating all paper Support for a technical dialogue between the FDA and documents and allowing remote inspection of port ANVISA to discuss the FDA’s experience in dealing documentation. with sensitive products (e.g., biologicals, vaccines, • Usage of increased emergency PAF funding and perishable supplies, emergency supplies, samples) in staffing to reduce backlog of inspection procedures. the U.S. Encourage the government of Brazil to create a specific norm for express delivery of such sensitive Recognize the importance of patent protection through products. both governments’ renewal and expansion of the scope of the Patent Prosecution Highway agreement, signed in 2015, to allow U.S. patent applications before Brazil’s National Institute of Industrial Property (INPI) in all technical fields for an unlimited time period.

Ɩ 4. POLICY AND SECTOR AGENDAS 43 Social Retail School. Opportunity everyday. Walmart is creating opportunity for the youth in Brazil through the Social Retail School program. By promoting the education of young people aged between 17 and 24 for the job market, with focus on the retail segment, more than 11.000 young people were trained since 2010. The program’s goal is to grant access to the rst formal job for 80% of the students. CONSUMER GOODS & 4.6. RETAIL

Chair Vice Chair

The Consumer Goods & Retail Task Force comprises member companies that support policy changes to enable job growth and improve the economy in Brazil. Toward that goal, the Council promotes these positions:

Endorse the approval of the labor law reform to Promote efforts to harmonize the value-added tax (VAT), promote job creation, facilitate collective bargaining known in Brazil as the Tax on Operations Related to the solutions, and allow part-time employment and Circulation of Goods and Services of Inter-Municipal flexible work hours, all of which will lead to effective Interstate Transportation and Communication (Imposto regulation and a more competitive business Sobre Operações Relativas à Circulação de Mercadorias environment. (Accomplished) e Serviços de Transporte Interestadual de Intermunicipal e de Comunicações – ICMS).

Promote the economic benefits associated with expediting bank credit card payment settlements, such as e-commerce growth opportunities. Support regulations to align labeling requirements with international standards. Support measures to develop transportation infrastructure to reduce logistics costs.

Advance private sector collaboration to promote best Support the Brazilian government’s efforts to better practices in recycling via Brazil’s National Waste Policy regulate counterfeit consumer products sold through as a path to economic sustainability. informal markets in Brazil to address lost tax revenue, lack of quality, and inventory control.

Ɩ 4. POLICY AND SECTOR AGENDAS 45 ENERGY 4.7.

Chair Vice Chair

The Energy Task Force recognizes energy as a high-potential sector for trade and investment between Brazil and the U.S. To that end, the Council endorses a number of actions to drive economic growth and advance the U.S-Brazil relationship:

Urge the Brazilian and U.S. governments to hold Support studies on the impact of renewable energy regular annual meetings of the Strategic Energy and cogeneration on the energy matrix as a whole, Dialogue with a collaborative agenda and allow robust with cooperation from the private sector and private sector participation. academia.

Urge the Brazilian and U.S. governments to sign a joint declaration concerning industrial and commercial cooperation in the nuclear energy sector to boost Urge Brazilian federal, state, and municipal governments bilateral business opportunities, with a focus on to streamline the environmental licensing process, research and development, supply chain support, and adopting clear criteria to avoid unnecessary risk, other nuclear applications (e.g., medicine, oil and gas, signiﬁcant delays, and investment uncertainty. and security). Support collaboration between the Brazilian and U.S. governments on environmental licensing (e.g., technical exchanges, staff training and development, and best Call for the Brazilian and U.S. governments to practices). establish a U.S.-Brazil work plan to create a global biofuels market, outlining joint efforts at the bilateral, trilateral, regional, and multilateral levels.

Recommend that the Brazilian and U.S. governments Support continued dialogue and collaboration between launch technical workshops on wind and solar energy the Brazilian and U.S. governments with private generation and transmission. sector participation to promote energy efficiency technologies. Work with the Brazilian government to establish a proactive and constructive agenda in Ensure that potential changes in tax legislation do not renewable energy generation and energy efficiency, increase the cost of electricity. which encourages generation and does not create inefficiencies and further costs on the market.

46 PROGRAM OF WORK 2017–2018 Ɩ OIL & GAS 4.7.1. WORKING GROUP

Chair Vice Chair

The Oil & Gas Working Group recognizes the importance of the oil and gas sector for trade and investment between Brazil and the U.S. To drive economic growth and advance the bilateral relationship, the Council recommends numerous actions:

Encourage the Brazilian federal, state, and municipal Support renewal of the Special Customs Regime for governments to streamline the environmental licensing exportation and importation of oil and gas products process, adopting clear criteria to avoid unnecessary (REPETRO) in Brazil, enabling the reduction of the risks, signiﬁcant delays, and uncertainty for investors. tax burden for a more cost-effective exploration and production of oil and gas. (Accomplished) Support more discretion for companies with respect to the Brazil’s National Petroleum Agency’s (ANP’s) requirement that they invest in Research, Object to two initiatives of the state of Rio de Janeiro, Development, and Innovation (PD&I) with accredited which create an environmental monitoring tax (Taxa de universities or national research and development Controle, Monitoramento e Fiscalização Ambiental das institutions. Atividades de Pesquisa, Lavra, Exploração e Produção de Petróleo e Gás – TFPG) and a value-added tax Support the Brazilian government’s Gas to Grow (Imposto sobre Circulação de Mercadorias e Serviços initiative to adapt the natural gas sector’s activities -ICMS) on the oil and natural gas sectors. to the new market and promote the opening of the market to foreign and national private investors. Focus on these areas: Support efforts to improve clarity on the norms • Adoption of good international practices. regarding unitization in Brazil via the National Council • Investment attraction. of Energy Policy (CNPE) Resolution. • Increased competition. • Diversity of agents. Recommend that the Brazilian government continues • Access to information. its practice of organizing regular oil bidding rounds to • Active participation of sector agents in the secure domestic and foreign investment as well as a regulatory process. continuous stream of royalties.

Promote the most effective way to develop the Brazilian Pre-Salt reserves is to allow private investors of any Urge the adoption of a more ﬂexible approach to local origin to operate projects with up to 100% participation content requirements in Brazil to better accommodate in the investment. rapid innovation and gaps in the local supply.

Ɩ 4. POLICY AND SECTOR AGENDAS 47 TOURISM & 4.8. HOSPITALITY

Below are the priority areas for member companies in the tourism & hospitality industry:

Visa-Free Environment Legalized Outsourcing Activities and Specialized The Brazil-U.S. Visa Free Coalition was created to Services Contracts increase economic and cultural gains from tourism Support bills that make outsourcing viable in Brazil and business travel and strengthen the Brazil-U.S. so that entrepreneurs can choose which activities to bilateral relationship. The coalition is composed of outsource based on their business models and protect participating member companies and stakeholder outsourced employees’ rights under the law. associations in the two countries. The short-term goal is Brazil’s inclusion in the U.S. Global Entry program, Flexible Workday and the long-term goal is to include Brazil in the U.S. Support congressional passage of the pending bill to Visa Waiver Program (VWP), with reciprocal treatment establish a flexible workday. Brazil’s labor laws make it by the Brazilian government. difficult to hire part-time employees, which results in lost opportunities to expand employment and hampers the sector’s ability to provide maximum customer service Open Skies (Air Transport Agreement) during peak demand. (Accomplished) Support congressional passage of policies to alleviate Brazil’s barriers to foreign airlines. Of the 100+ nations Infrastructure that have signed open skies agreements with the U.S., Promote a policy agenda designed for foreign investors, Brazil is one of only a handful that has not put it into including the U.S. as a strategic partner under the U.S.- effect. Approval of the agreement would significantly Brazil Memorandum of Cooperation for Infrastructure liberalize U.S.-Brazil air services for airlines, travelers, Development. The Council supports Brazil’s Investment and shippers, and the U.S. and Brazilian economies Partnership Program to strengthen cooperation between would benefit from competitive pricing and more state and private sectors through agreements on public convenient service. infrastructure projects and privatization. Key infrastructure issues include project prioritization and promotion of transparent bidding processes and environmental Regulatory Framework for Casinos in Brazil licensing process simplification. Promote the approval of bills authorizing gambling in Brazil with provisions to encourage the gaming Tax Simplification industry to notify the public of responsible gaming Support Brazilian and U.S. governments’ pursuit resources, while incorporating responsible gaming of their 2007 presidential commitment toward an into business operations. agreement addressing the issue of double taxation.

48 PROGRAM OF WORK 2017–2018 Ɩ MEET THE TEAM

CASSIA M. CARVALHO

Executive Director

+1.202.463.5942 [email protected]

RENATA MACON VASCONCELLOS FIELD

Senior Policy Policy Director Director

+1.202.463.5628 +1.202.463.5694 [email protected] mﬁ[email protected]

JOÃO BRUNO BARROSO SCHWARTZ

Resident Senior Director of Programs Advisor and Member Services

+55.61.99800.0825 +1.202.463.5768 [email protected] [email protected]

MONICA BILL DE BOLLE MORLEY

Senior Senior Advisor for Advisor Congressional Affairs

[email protected] [email protected]

Ɩ PROGRAM OF WORK 2017–2018 49 PARTNERS

Brazil

U.S.

U.S.-Brazil CEO Forum Congressional Brazil Caucus

50 PROGRAM OF WORK 2017–2018 Ɩ

1615 H Street, NW | Washington, DC 20062-2000